Fact based stock research
NVR (NYSE:NVR)

US62944T1051

How to read the ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

NVR stock research in summary

nvrinc.com

ANALYSIS: With an Obermatt Combined Rank of 12 (worse than 88% compared with investment alternatives), NVR (Homebuilding, USA) shares have lower financial characteristics compared with similar stocks. Shares of NVR are low in value (priced high) with a consolidated Value Rank of 5 (worse than 95% of alternatives), and are riskily financed (Safety Rank of 44, which means above-average debt burdens) but show above-average growth (Growth Rank of 59). ...read more

RECOMMENDATION: A Combined Rank of 12, is a sell recommendation based on NVR's financial characteristics. As the company NVR shows low value with an Obermatt Value Rank of 5 (95% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 59% of comparable companies (Obermatt Growth Rank is 59). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 44 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for NVR, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	5
Growth Rank	59
Safety Rank	44
Combined Rank	12

Country	USA
Industry	Homebuilding
Index	S&P US Luxury, S&P 500
Size class	X-Large

18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: NVR

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	8	17	7	5
GROWTH
GROWTH	80	83	21	59
SAFETY
SAFETY	83	44	44	44
SENTIMENT
SENTIMENT	n/a	55	47	^new
360° VIEW
360° VIEW	n/a	61	19	^new

Most recent update of the stock research: 18-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better NVR is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	8	17	7	5
GROWTH
GROWTH	80	83	21	59
SAFETY
SAFETY	83	44	44	44
COMBINED
COMBINED	63	12	12	12

Last update of combined financial performance: 6-Oct-2022. Stock analysis on combined financial performance: The higher the rank of NVR the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 5 (worse than 95% compared with alternatives), NVR shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for NVR. Price-to-Sales is 5 which means that the stock price compared with what market professionals expect for future profits is higher than 95% of comparable companies, indicating a low value concerning NVR's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 12, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of NVR. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 24 and Dividend Yield, which is lower than 99% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 5, is a sell recommendation based on NVR's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for NVR? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as NVR? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. NVR may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	35	17	9	5
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	60	36	21	24
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	4	13	17	12
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	8	17	7	5

Last update of Value Rank: 18-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of NVR; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 59 (better than 59% compared with alternatives), NVR shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for NVR. Capital Growth has a rank of 68, which means that currently professionals expect the company to grow its invested capital more than 44% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 67 (above 67% of alternative investments). But Sales Growth has only a rank of 29, which means that, currently, professionals expect the company to grow less than 71% of its competitors, and Profit Growth is also low at a rank of 44. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 59, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for NVR, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	57	42	8	29
PROFIT GROWTH
PROFIT GROWTH	12	45	60	44
CAPITAL GROWTH
CAPITAL GROWTH	n/a	90	7	68
STOCK RETURNS
STOCK RETURNS	71	79	61	67
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	80	83	21	59

Last update of Growth Rank: 18-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of NVR.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 44 (better than 44% compared with alternatives), the company NVR has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of NVR is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, where all three are above average for NVR. Leverage is at 69, meaning the company has a below-average debt-to-equity ratio. It has less debt than 69% of its competitors. Refinancing is at a rank of 82, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 82% of its competitors. Finally, Liquidity is also good at a rank of 85, which means that the company generates more profit to service its debt than 85% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 44 (worse than 56% compared with alternatives), NVR has a financing structure that is riskier than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with NVR but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	55	54	62	69
REFINANCING
REFINANCING	47	82	82	82
LIQUIDITY
LIQUIDITY	87	67	77	85
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	83	44	44	44

Last update of Safety Rank: 6-Oct-2022. Stock analysis on safety metrics: The higher the rank, the lower the leverage of NVR and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	10	35	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	31	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	95	77	^new
MARKET PULSE
MARKET PULSE	n/a	34	54	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	55	47	^new

Last update of Sentiment Rank: 18-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for NVR.
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